Sovereign Wealth Funds
State owned investment funds comprised of a country’s reserve capital.
Sovereign Wealth Funds often have a higher degree of risk as they often take large ownership stakes and allocate heavily to emerging/developing markets. SWF’s tend to be opportunistic investors during economic decline.
Major Considerations
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Focused on larger funds and more established managers
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Can be highly selective
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Can make opportunistic investment commitments
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Can have a long due-diligence process
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Often like co-investments
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Can be important anchor or cornerstone investors for regional funds
Typical Allocation
SWFs have an aggregate alternatives allocation of around 27% of total AUM.
HOW DO SOVEREIGN WEALTH FUNDS INVEST?; State Street Global Advisors
Largest SWFs
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Government Pension Fund Global, Norway; AUM - 1.1T
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China Investment Corporation, China; AUM – 950Bn
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State Administration of Foreign Exchange, China; AUM - 690Bn
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Kuwait Investment Authority, Kuwait; AUM – 592Bn
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Abu Dhabi Investment Authority, UAE; AUM – 580Bn
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Hong Kong Monetary Agency, Hong Kong; AUM – 531Bn
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Saudi Arabian Monetary Agency, Saudi Arabia; AUM – 510Bn
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GIC, Singapore; AUM – 510Bn
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Qatar Investment Authority, Qatar; AUM – 330Bn
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National Social Security Fund, China; AUM - 325Bn
PreQin 2020
Articles of Interest
THE WORLDS BIGGEST SWF CRACKS DOWN ON COAL; Aljazeera
THE LONG TERM STRATEGY OF GULF SOVEREIGN WEALTH FUNDS; Asia Times
GOVTS WORLDWIDE DRAWDOWN ON THEIR SWFs; Trinidad & Tobago Guardian
EXTERNAL MANAGERS DELIVER 4.1BN EXCESS RETURN FOR SWF; CityWire